Minority shareholders in Vimpelcom, Russia’s number two mobile operator and the current listed entity, would receive one depositary receipt for each Vimpelcom depositary receipt currently held, or be bought out at 0.05 kopecks per depositary receipt.

HSBC chief fears a second downturn - Financial Times (55.01). Financial Times reports Michael Geoghegan, chief executive of HSBC (HBC), is so convinced there will be a second downturn in the coming months that he plans to delay any rush to expand the bank. Mr Geoghegan was speaking after HSBC announced a shake-up of its governance 10 days ago. He is now responsible for strategic issues that previously lay with Stephen Green, chairman. "I'm not as convinced we're through the worst as others are. The reality is that profits will be quite reduced." His comments come in spite of expectations that in his amplified role he will push HSBC to grow more aggressively.

We think the deal is positive for VimpelCom as it removes the long-termshareholder conflict risk. The new company will own the best in the classwireless assets in Russia, Ukraine and Kazakhstan as well as one of thebest Russian fixed line and broadband operations. While the impliedKyivstar multiple is at a premium to VimpelCom’s own 2010E EV/EBITDAof 4x, in our view this is an acceptable price for eliminating theshareholder conflict and getting control of the best asset in Ukraine. Weexpect investors to rerate the combined entity from the current depressedlevels of VimpelCom’s valuation on the removal of the corporategovernance risks and addition of the best in class assets. Our VimpelComprice target is unchanged.

"True genius resides in the capacity for evaluation of uncertain, hazardous and conflicting information."

-- Winston Churchill After hitting highs two weeks ago, the major indices have been steadily losing momentum. We have had a few similar pullbacks since the big rally began in March, and each time the market not only found its footing fairly quickly but resumed very strong upside momentum.

There is no question that we have had some technical deterioration, especially last week, and that means we have to take some defensive action. The bigger question, however, is whether this is just another routine pullback within a massive uptrend or the beginning of a real change in character. Looking for the market to actually top out has been one of the most frustrating and costly approaches you could take for months now. A lot of folks have been skeptical about the economy and firmly believe, as Professor Nouriel Roubini stated this weekend, that "markets have gone up too much, too soon, too fast."

The problem for the bears is that they have held that belief for a while now and have been constantly frustrated as the market keeps going. These skeptics have turned into very powerful dip-buyers because they are so sick of being left behind as the market keeps trending higher. A lot of the folks who are buying pullbacks aren't aggressive bulls; they are just tired of being underinvested in a trending market, so they dip their toe in whenever we have a little pullback.

Although the technical conditions of the market look shaky after four straight days of decline, it is probably a mistake to write off the dip-buyers who were so tenacious for so long. They may move to the sidelines and take a rest, but they haven't been hit hard enough to give up on what has been an extremely profitable approach for so long.

The bulls have two big positives working for them right now. First, earnings season is starting up, and expectations are going to be very high after the very strong reaction to reports in the second quarter. The market went almost straight up after Intel (INTC) kicked off the second quarter with a good report. There was a flood of better-than-expected reports, and we ended up with several weeks of extremely strong momentum. Expectations may turn out to be too high for the third quarter, but market players are likely to be optimistic at first, and they should help us for the next couple weeks.

The other big positive driver for this market is liquidity. With interest rates at nearly zero and a huge amount of government stimulus and bailouts at work, there is a lot of cash looking for a place to go, and quite a bit of it is being parked in equities. That has been a huge driving force for this rally, and it isn't going to suddenly end.

I believe that the very high levels of liquidity are going to prevent the market from doing a sudden U-turn back down. We may start to see a downtrend develop, but it won't be the inverse of what we saw on the way up. It will be much more gradual, and we will have many rallies and spikes along the way.

In summary, the market has some troubling technical aspects, but it has conditions in place that can help support it and even drive further rallies. While we want to be more cautious given the bigger picture, we don't want to be inflexible and close-minded. The market has issues, but there are also positives that will help to hold things aloft.

This morning, we have Goldman upgrading big-cap banks Wells Fargo (WFC) and Capital One (COF) , an upgrade of Research In Motion (RIMM) by Needham and some weakness in the dollar that are helping matters. Overseas markets are slightly positive. -----------------------------Ülespoole avanevad:

Briefing: BusinessWeek reports hundreds of dairy farmers drove tractors into Belgium's capital to pressure EU farm ministers on the milk price crisis as 20 of 27 nations called for more protection from the volatile world market. Farmers want regulation to shield them from volatile free market prices that have collapsed milk prices. Some 20 EU nations met ahead of the meeting, agreeing to push for a new system to regulate the market once the EU phases out market-distorting quotas in 2015.